Pika Backup for /home/ to an external drive. It’s an automatic solution with a simple GUI that serves as a front end to Borg iirc. Lets you easily browse and mount old backups. Anything outside of my actual personal files can be recreated or restored trivially, so I don’t care to back them up.
I also have a manual dump of /etc/ but i change it so infrequently that it doesn’t really need looking after.
Notepad in wine is pointless compared to something like gedit, which you have, or similar editors like geany or kwrite. Cinnamon might even have their own basic text editor. And then there are further options like mousepad from the xfce project or featherpad from the lxqt project.
Notepad in wine will just lead to frustration because of poorer integration.
Finally, I just saw your edit and I think you’re spot on. Not because of ARM, which is actually decently supported, but because running an OS off of a microSD card is slow and tedious. It just isn’t made for that quick, small random access.